BiggerPockets

I'd like t get everyone's thoughts on handing over one's wealth to their children and grandchildren after passing away. The practice has infuriated me for as long as I can remember—mostly because:

1) I am not one of those children or grandchildren,

2) The wacked-out principles behind such gifts, and

3) What often happens to the money and the recipients.

All four of my grandparents as well as my father had passed away before I was out of middle school. I don't remember receiving any inheritance, and I didn't care about one then or now. I'm sure that if someone in my family died and bequeathed a substantial amount of money to me, I would graciously accept it and do my best to put that money to work and not blow it on stupid stuff. But that still doesn't make it the best use of their funds and I'll be darned if I do the same with mine.

Of course, someone's wealth is theirs to spend however the heck they want to spend it before and after death. I just can't understand why people feel the need to give money to children who have done absolutely nothing to deserve it. Yes, you heard me. I don't believe anyone deserves to inherit anything. It is a gift that someone may choose to give to their children, or they may find some place to give it that is even more wise and beneficial.

Let's say I die when I'm old and have an estate worth millions of dollars:

1) What service have my children provided that justifies such a substantial compensation? If anything, I think children should pay their parents to reimburse them for all of the time and hours spent teaching them, cleaning poo, and keeping them alive.

2) What special needs do they have that justify hundreds of thousands or even millions of dollars? It would be one thing if they had a major medical condition that could be cured with a sizeable inheritance. But if this were the case, I'd likely use the money for that purpose before dying and not after.

I can hardly believe that my children need the funds from my estate more than starving people somewhere else in the world. In all likelihood, my kids will grow up in middle-class neighborhoods, go to college, stay out of debt, and be able to provide for themselves. Hopefully they will listen to what I have to say about becoming wealthy, but if not, I have no reason to believe they will not be at least middle class, (assuming there still is one in 20-30 years).

So what on earth would make me believe that these privileged, self-supporting, and independent sons and daughters of mine need money more than people whose homes were destroyed by tsunamis through no fault of their own? Or breadwinners in less-advantaged countries who could finally escape the shackles of poverty by starting a small business with the help of a micro-loan?

But instead, people must think, "I love my kids. I want to give them stuff. When I die, I'm going to hand over to them on a silver platter everything that I, in comparison, have had to scratch, scrimp, save, and toil for my entire life." Dumb, dumb, dumb, dumb, dumb.

I've had to work for every dollar I've earned—why should they be any different? The idea of handouts is appalling. Million-dollar handouts? Gag me with a spoon.

3) Will they even know what to do with it? Do I even need to go into what happens the vast majority of times when the 2nd and 3rd generation receive money earned by the 1st generation? It gets blown and the kids come out rotten. I've seen it among my contacts, and there are several books and plenty of research on the subject.

For these reasons, I might give them a nice bonus or something when I kick the bucket, like a down payment on a house. But even then I'd make it conditional, according to the rules of my living trust, upon at least the following:

A) Their mortgage payment is 1/3rd of their income or less,

B) They have no consumer credit card debt, and

C) They have not willfully misspelled any of their children's names on purpose, just to be different (another pet peeve of mine).

But any wealth I still have at that time, provided I didn't spend it all on $1000/pill prescription drugs, is going to micro-loans or some other place where at least 90% of donated funds will go to recipients who really need it.

Interesting subject.

Here's my relatively short response. My parents are LOADEDDDDDDD!!! Tons of cash, property ect. They have many acres of property in California, that have been held for 4 generations and have been offered millions for it by builders. I have done very well for myself--even put myself through college without a dime from them. I live in the Oakland Hills--not Oakland proper.
Have a sibling or two that are not doing so well, and I can see them circling the prey. I HOPE AND PRAY that my folks give every bit of their estate to something other than their kids and have even told them so. I don't look forward to getting it or do I need it. On the other hand, I won't let my siblings take what would have been mine EVEN if it costs me more in attorney fees to get my fair share. The executor is " mommy's favorite" and a total loser business wise. He will manipulate things to his advantage, if he think he can get away with it for one second. What he doesn't know is that I won't deal with him directly, when the time comes. He has a fiduciary responsibilty to those in the will. That explanation will arrive to him from my attorney, as soon as the situation arrives.

Thanks for asking :cry:

Dwayne

So don't feel bad for not leaving it to your kids; I don't feel bad for not getting it!

I agree, not only about leaving money to kids when you die, but the people who spoil their kids, so they don't understand the value of hard work.

There is nothing more stupid than seeing that 16 year old kid in a brand new BMW-great parenting there and unfortunately these kids often end up wrapped around a tree.

I'm spending all my money on educating my kids.

Half of my kids will be attorneys specializing in contingency cases.

The other half of my kids will be attorneys specializing in drawing up deeds, writing sandwich lease options, evicting tenants, creating LLCs and land trusts, and so forth.

And the last half of my kids will become politicians.

Man, can you spell 'return on investment'?!

Here are my thoughts on some of the responses that have been made to my original post. I disagree with some, of course, but everyone seemed to put thought into it. Thanks for your interest!

Quote: I am educating my children to believe in modest living, free markets and social responsibility. I am teaching them how to become stewards. I hope that they take any wealth I leave to them (not likely to be a big pile of cash, by the way, more likely to be business and investment assets) and increase it geometrically.

Response: I think that's the ideal thing to do, if you can somehow guarantee that it can be done successfully.

Quote: They have many acres of property in California, that have been held for 4 generations and have been offered millions for it by builders.

Response: I have never understood why families keep land for generations and never sell it. What good is it, then? You might as well not have it if you never use it.

Quote: And what kind of inheritance does a child receive when Dad 'could've' helped out but didn't because 'he said I didn't deserve it?'

Response: What I mean is that the world doesn't owe them anything. They shouldn't expect the money. They do not deserve to inherit money. How can you deserve a gift? Do I deserve to get a birthday present every year? I do think they deserve to inherit food, shelter, knowledge, love, support, etc, though, because that is my moral responsibility.

Quote: To tell you the truth, I don't see many charities that deserve any money, either. Quite often, your money doesn't go towards what you think you are giving it to. I didn't bust my butt all my life to give some charity a bigger advertising budget and another luxury summer home for their director.

Response: I couldn't agree more. There are probably only a handful of really good charities where most of the money is spent actually helping people. You better believe I will do my research first before choosing one.

Quote: I think it's horrible that a parent would rather give their money away and hurt his children so deeply.

Response: What person can honestly say they need the money more than a tsunami victim who has lost everything? I pity whoever would be "hurt" if their parent chose to keep someone from starving to death over handing out money to them.

Quote: It maybe different if you have looser kids, but then again. Who's fault is it that your kids are losers?

Response: My concern is that the money would corrupt them. It happens all the time.

Someone wiser than me once said:

" Give your children enough so that they can do anything, but not enough that they can do nothing."